North Coast Co-op: we’re making money again, and local farmers are key

Co-op Returns to Profitability, Commits to Buying $700,000 from Local Farmers

ARCATA & EUREKA – As it has every year, North Coast Co-op sat down this winter with local farmers in a series of meetings to establish what will be grown by each farmer for the Co-op. This year the Co-op plans to spend more than $700,000 with local farmers. Some farmers sell anywhere from $50,000-$100,000 annually to the Co-op. Typically those are farmers who have built their business with the Co-op over decades.
This annual commitment by the Co-op creates a reliable market for farmers and a consistent source of local, fresh, organic produce for shoppers. The relationships with some farmers go back more than 40 years. Many farmers had their first retail accounts at the Co-op.
“We have sold more to the Co-op every year for the last 10 years. It’s a reliable market not dependent on weather or season. There just isn’t another supermarket that is so dedicated to working with the farmers. The Co-op bends over backwards to work with us,” said Jacque Neukom, owner at Neukom Family Farm in Willow Creek.According to Neukom, it’s more than just the sales to the Co-op that are important, it is that the Co-op provides support for farmers to take a risk to bring a new product to market. Neukom says it took years to develop a market for yacón, a sweet tasting tuberous root used in fresh salads or as a healthy snack. The Co-op worked with him on finding the right price point, marketing materials and consumer education. Eventually, yacón became a staple and other stores called him to place their orders.
“We are lucky enough as farmers to choose where we sell our product and we always choose the Co-op first,” says Neukom. “The Co-op’s employee retention is amazing, which means we are able to work with the same knowledgeable people for years and decades.”
This year’s commitment to local farmers is larger than it has been in the past because it includes produce for use in the Co-op’s delis.
“We want to make our food with as much local as possible, but that means the farmers need a chance to plan for an increase in production. This year we included the Deli’s needs in our annual meetings with farmers,” says North Coast Co-op’s Food Service Director Lauren Fawcett.
The Co-op has seen double-digit sales growth in its prepared foods department since introducing the new food bar at its Eureka store location. Customers say they love building unique “Goodness Bowls” with organic rice or quinoa, organic veggies, house-made sauces and hormone-free meats. The emphasis on local is also key to that sales growth.
The success of the new food bar is part of the Co-op’s return to profitability. North Coast Co-op has seen two consecutive profitable quarters, with the largest gains in March. This comes after nearly a year of losses brought on by challenges with a major remodel project and a simultaneously declining economy.
For several years, the Co-op had been in the planning and permitting phase of a $5 million-dollar remodel that would triple the size of its Deli, improve layout, and resolve infrastructure issues at its 4th & B Street location in Eureka. Permitting delays, along with several large health insurance claims, ate away at cash reserves until March 2018 when they put the project on hold. Not long after, they began to relate the sales declines they were seeing at both stores to the impact of cannabis legalization.
The Co-op was not the only business to share that they were feeling the effects of legalization. Many businesses and distributors who sell to the Co-op felt the impact also, in and out of the region. The Co-op purchases from nearly 200 local vendors in Humboldt County alone, with approximately 25 of those being local, organic farmers.
“When the Co-op sees a decline in sales, so do some of the local growers and producers who depend on our account. We are very aware of how important the Co-op’s success is to that of the community at large. We are part of an intricate network of businesses, livelihoods and community nourishment,” said North Coast Co-op’s General Manager Melanie Bettenhausen. “Building sales back ensures that we can continue supporting local farmers.”
North Coast Co-op says its sales are still trending down, but only about one percent, which is an improvement over last fall. Going into the summer, they have plans to host a kick-off event to highlight the new deli offerings at their Eureka location. Over the last few months a new food bar was installed, the footprint of the Deli was expanded, and they are introducing a new juice bar and signature sandwiches later this month.
North Coast Co-op anticipates positive sales growth in the coming months. Over the holidays, Co-op members showed their support by spending more of their grocery dollars at the store that they own. That loyalty has extended into the new year.
“With a robust tourist season anticipated, and new offerings delighting customers, things are looking up,” says Bettenhausen. “Our employees have worked really hard to make sure customers want to shop with us and our community has been very supportive. We are so thankful and hope we can continue to contribute to the success of others, including our local farmers. We are all in this together.”